Operating joint accounts

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A joint account is an account held by two more persons. The important legal consequences of holding a joint account are:

the right of survivorship – when one joint holder dies, the surviving joint holders automatically take the deceased joint holder’s interest in the account (for business accounts different rules may apply)

joint and several liability – if the account is overdrawn, each joint holder is individually liable for the full amount owing.

You can operate a joint account on an ‘all to sign’ or ‘either/or to sign’ basis:

All joint account holders must consent to the joint account being operated on an ‘either/or to sign’ basis. However, any one joint account holder can cancel this arrangement, making it ‘all to sign’.

Note: The right of survivorship does not automatically apply to joint business accounts, such as partnerships. A partner’s interest in a business joint account would normally pass to beneficiaries nominated in the partner’s will of next-of-kin if there is no will.

If you are operating a business partnership joint account, you should obtain your own legal advice to ensure your wishes are carried out.

To help members achieve their financial goals by building relationships for mutual benefit

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